According to the latest reports, Lloyds Banking Group has set aside a further £100m to cover payment protection insurance (PPI) mis-selling as it reported flat quarterly profits. In addition, pre-tax profits for the first three months of the year were £1.6bn, unchanged from the same period a year earlier.
The uncertainty and concerns over Brexit continue, with the bank warning that the unknown could have an even bigger impact on the UK economy. Even so, Lloyds says it has not seen the quality of its assets deteriorate. The Royal Bank of Scotland and Barclays, on the other hand, both blame Brexit uncertainty for falling margins on intensifying competition in the mortgage market and slowing business investment – a very different response than Lloyds.
“While Brexit uncertainty persists, and continued uncertainty could further impact the economy, I remain confident that our unique business model, and in particular our market leading efficiency and targeted investment, will continue to deliver superior performance and returns for our customers and shareholders,” says the group’s chief executive, António Horta-Osório.
UK Regulators Set PPI Deadline
Payment protection insurance (PPI) is insurance that will pay out a sum of money to help you cover your monthly repayments on mortgages, loans, credit/store cards, etc. in the event that you are unable to work. This could be the result of illness, accident, death or unemployment and will be covered on your policy.
A deadline of August 29 has been set by the UK’s financial regulator for the final PPI mis-selling claims to be made. According to reports, more than £34bn has already been paid out in compensation across the industry as a whole. Major banks have also set aside billions more for future claims.
As far back as the 1970s, upwards of 64 million PPI policies were sold in the UK. The intent was that these policies would cover loan payments if borrowers fell ill or lost their job. The fact that many sales were pushed on a huge scale to people who did not need them or could not use them has now created a bit of an obstacle for the industry.
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Author Bio: Payment industry expert Taylor Cole is a passionate merchant account expert who understands the complicated world of accepting credit and debit cards at your business. His understanding of the industry and ability to compare merchant services has helped thousands of business owners save money and time.